More Money, More Offers: Colleges Using Financial Status in Admissions Process

College money

By Jeff Calareso

The Recession Goes to College

Before the recent economic collapse, many elite colleges and universities employed need-blind admissions policies. This meant that you were considered for acceptance regardless of your family's financial standing. The widespread consensus was that everyone should apply for financial aid in order to offset the steep costs of college. It was even becoming common for schools to take this further, expanding aid offerings and changing loans to grants in order to broaden applicant pools.

In recent years, the recession has hit colleges and universities on multiple fronts. Students have been in greater need of aid as their families are suffering. At the same time, the endowments that schools relied upon as a financial cushion are being replenished more slowly as donors are giving less. This loss of revenue has caused a need to change admissions policies.


Admissions in the New Era

Whether you apply to Williams College, Tufts University or another elite institution, your financial status may matter more than before. These schools may be more inclined to admit you if you can pay full tuition. Applying for financial aid regardless of need may now hurt your chances. In practice, this means that if you and another candidate are of relatively equal merit, and only one can be admitted, the institution may choose the wealthier student.

These schools often stress that they aren't lowering their admissions standards. Yet they might be modifying their policies in order to take money into account. For example, Middlebury College has claimed it'll continue first round need-blind admissions for U.S.-based students; yet for wait-listed students, as well as transfers and international students, it may consider students' ability to pay more.

There are some schools that maintain a need-blind admissions process. These include Ivy League institutions such as Stanford University, Dartmouth College and Yale University. Yet many of these schools are recalibrating how they allocate aid in order to provide less financial support to wealthier families. This often means that families will receive less aid for their income level than in years past.

Student debt

Looking Elsewhere for Students

One other way these institutions are changing is by seeking students who've historically been more lucrative. This often means focusing on international students. Need-blind policies typically don't apply to students from abroad. This enables schools to more easily pursue international students who can pay full or higher tuition.

State universities are employing a similar tactic. In the face of state budget shortfalls, these universities are often suffering for cash. As a result, they're shifting their attention to out-of-state students who pay a higher tuition rate than in-state students. At the University of Michigan, for example, out-of-state students represented 40% of the incoming class in 2010, up from 34% in 2008.

At public universities in particular, the recession is leading some schools to raise tuition to combat decreases in funding.

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